Nintendo or Nintendon’t? Company Faces Annual Loss for Third Straight Year

Things are looking grim for Nintendo. The video game company, which experienced extraordinary success with the launch of the Wii in 2006, has now faced annual losses for the third year in a row. Many of Nintendo’s recent shortcomings are due to the disappointing release of the Wii U in November 2012. The console has sold a mere 5.3 million units since its launch, and has failed to compete with Sony’s PlayStation 4 and Microsoft’s Xbox One, which have sold 4.4 million and 3.1 million units, respectively, since their launches in November 2013.

Satoru Iwata, Nintendo CEO, predicted sales of the Wii U to exceed 9 million units for the 2013 fiscal year. That number turned out to be less than a third of that amount, a paltry 2.8 million. The fallout from this announcement has been unfortunate for the company, with the company’s stock falling 6 percent, according to Time.

The Wii U’s poor sales stem from many factors, perhaps the most significant arising from Nintendo’s marketing strategy. The casual gamer market that made the Wii so successful—the Wii sold more units in 2007 than the PlayStation 3 and Xbox 360 combined, according to NPD Group—has since been tapped by companies such as Apple and Samsung, which have released smartphones and tablets equipped with the casual games that made the Wii popular in the first place. The core and hardcore gamers, communities of players who prefer longer and more in-depth games, is a market that has been neglected by Nintendo in recent years. As a result, these gamers have turned to Sony and Microsoft for titles that are more complete and demanding, while Nintendo has continued to plumb a market has lost its enthusiasm.

It wasn’t always this way, though. Back in the 1980s and 1990s when home consoles were gaining popularity, Nintendo was the king of console developers. Sure, Nintendo faced competition from Sega (as the old commercial one said, “Sega Genesis does what Nintendon’t!”), but the Nintendo Entertainment System (NES) and Super Nintendo Entertainment System (SNES) ended up selling far more than Sega’s systems and even became a household name. Video games weren’t called “video games.” They were called “Nintendo games.” First party titles such as “The Legend of Zelda” and” Super Mario Bros.” gained enormous followings and catapulted Nintendo to the top of the video game industry until very recently.

Hopefully these first party titles will keep Nintendo from going the way of its formal rival, Sega, which ended up abandoning hardware manufacture altogether and instead developed software to be played on other companies’ consoles. It would be a grim day indeed for longtime gamers everywhere to see Mario and Zelda games developed for the PlayStation. With the next generation of gaming consoles upon us, Nintendo may have to rely on these games’ longstanding popularity to remain afloat, as major studios such as EA and Bethesda (developer of “The Elder Scrolls V: Skyrim” and the “Fallout” series) have gone on record to say they will no longer make any games for Nintendo platforms due to the inconvenience of developing for the WiiU’s hardware.

Nintendo needs to do something different, and it needs to do it now. The casual gamer market that made Nintendo immensely successful in 2007 has since been drawn away by other companies’ tablets and smartphones. It might be time for Nintendo to return to its roots, to the hardcore gamers who sat for hours in front of their NESs and SNESs, speeding Mario over Goombas or guiding Link through the labyrinth of Hyrule. This is what made Nintendo popular. Nintendo is what made video games popular. Let’s hope they can get back to doing what they do best before it’s too late.